HE 

£791 


V 


HARVEY   FISK. 


A.  S.    HATCH. 


R'Xft 


o  i\t  »8ndl(olders 


Central  Pacific 

Railroad     Company. 


JANUARY  1st,  1872. 


FISK   &  HATCH,  Bankers, 


> ;kw  vohk, 


fc$ 


1 

1 


T 


Banking  House  of  FISK  &  HATCH, 
No.  5  Nassau  Street,  New  York. 

January  1st,  1872. 

At  the  close  of  the  year  1871,  we  are  enabled  to 
lay  before  the  holders  of  the  securities  of  the  Cen- 
tral Pacific  Railroad  Company,  a  Statement  of 
the  business  operations  and  revenues  of  the  Com- 
pany, and  the  increasing  value  and  importance  of 
its  immense  property  and  traffic,  which  must  prove 
of  more  than  usual  interest  and  satisfaction  to 
them. 

The  Operations  of  the  Road  have  been  con- 
ducted throughout  the  year  with  great  regularity 
and  success,  without  the  intervention  of  any  im- 
portant interruption  or  accident. 

The  receipts  from  passengers  and  transportation 
have  increased  about  20  per  cent,  over  those  of  last 
year. 

The  increase  in  the  through  passenger  travel 
westward  and  in  the  shipments  of  Asiatic  and 
California  products  eastward  has  been  so  rapid 
and  important,  that  notwithstanding  an  unprece- 

Ik*  Ik 


2 

dented  drouth,  and  the  consequent  large  reduction 
in  the  wheat  harvests  of  California,  the  Gross  Re- 
ceipts for  the  year  1871,  as  will  be  seen  below, 
amount  to  upwards  of  $9,500,000,  thus  substan- 
tially justifying  the  estimates  made  at  the  begin- 
ning of  the  year. 

With  an  average  wheat  crop  in  the  fertile  val- 
leys of  California  which  are  traversed  by  the  Cen- 
tral Pacific  Railroad  and  its  branches,  the  earn- 
ings for  the  year  would  have  largely  exceeded  the 
estimate  of  $10,000,000  which  we  ventured  to  give 
in  our  Statement  of  January  2d,  1871. 

Full  returns  of  the  details  of  through  and  local 
passengers  and  freights  have  not  been  received  for 
the  year  just  closed,  but  the  following  figures  for 
1870  will  show  the  very  large  proportion  of  local 
travel  and  traffic,  which  the  Central  Pacific  Rail- 
road enjoys  in  addition  to  its  large  receipts  from 
through  transportation  between  the  Atlantic  and 
Pacific  States : 

PASSENGERS— 1870. 

Through,  Eastward _  _  _ 23,795 

"\036 


Westward 32,241 


}   56,< 


Local,  Eastward 313,539  -» 

"       Westward .297,019] 

Total  passengers,  through  and  local, 666,594 


FREIGHTS— 1870. 

Through,  Westward... 35,577,273  lbs. 

Eastward..... ...22,826,357     " 

Local,  Westward 383,853,604     " 

"       Eastward 458,160,411     " 


Total  freights,  through  and  local,  900,417,645     " 

The  Overland  Transportation  of  East  India 
Goods,  especially  of  tea  and  silk,  via  the  Central 
Pacific  Railroad,  although  comparatively  in  its  in- 
fancy, has  developed  with  an  unexpected  rapidity, 
exceeding  the  most  sanguine  expectations.  The 
following  table,  showing  the  remarkable  increase 
in  shipments,  eastward,  over  the  Pacific  Railroad 
from  San  Francisco  for  the  first  nine  months  of 
1871,  compared  with  those  for  the  corresponding 
period  in  1870,  is  taken  from  the  Alia  California 
trade  review  of  late  date  : 

1870. 
Articles.  (9  months.) 

Tea lbs.    1,559,317 

Silk 92,906 

Wine 750,036 

Wool 4,487,126 

Salmon 445,994 

Hops 94,907 

Leather 584,779 

Cotton,  glue,  coffee, 

quicksilver,  crude 

metals,  etc 100 


Total  lbs 8,015,165 


1871. 

(9  MONTHS.) 

Increase. 

9,671,761 

8,112,444 

628,339 

535,433 

1,502,250 

752,214 

12,949,751 

8,462,625 

609,713 

163,719 

134,505 

39,598 

1,193,607 

608,828 

1,542,582 

1,542,482 

28,232,508 

20,217,343 

4 

The  following  tables  of  earnings  for  each  month 
of  the  years  1870  and  1871,  will  show  the  steady 
increase  in  the  business  of  the  Road: 

1870.  1871. 

Months. 

January $413,104.41  $536,498.94 

February 394,176.47  485,490.06 

March 488,331.92  614,446.95 

April 633,758.06  720,929.22 

May 768,719.77  892,341.33 

June 729,274.46  795,176.35 

July 783,099.64  869,296.82 

August 807,815.68  1,006,373.11 

September *787,183.48  995,921.89 

October 828,447.09  981,005.48 

November f777,513.13  898,862.00 

December £583,692.07  ||750,000.00 

$7,995,116.18  $9,546,342.15 

The  ratio  of  operating  expenses,  (estimating  for 
the  last  two  months),  will  be  less  than  50  per 
cent,  and  the  Net  Earnings  for.  the  year  will 
exceed  $5,000,000. 

The  subjoined  table  will  show  the  Gross  Earn- 
ings and  Operating  Expenses,  and  the  number  of 
miles  operated  in  each  year,  from  the  commence- 
ment to  the  present  time. 

*  Given  $10,000  less  in  last  statement  by  a  typographical  error. 

f  Given  in  our  statement  of  last  year,  as  telegraphed  approxi- 
mately, $746,800.  The  official  returns  show  an  addition  of 
$30,713.13  as  above. 

X  Estimated  at  $550,000  in  our  statement  of  last  year. 

II  Estimated. 


MILES  OPERATED.  GROSS  EARNINGS.  OP.  EXPENSES 

1864 18  to  36  $113,413.89  $66,541.98 

1865 31  to  56  401,941.92  121,669.53 

1866 56  to  94  864,917.57  200,710.61 

1867 94  to  137  1,421,525.14  333,623.92 

1868 137  to  468  2,315,409.00  845,632.64 

1869 468  to  742  5,716,115.54  3,124,618.54 

1870 742  to  900  7,995,116.18  4,194,354.84 

1871 900  to  1,000*  9,546,342.15  4,325,428.11 

Total $28,374,781.39       $13,212,580.17 

The  following  will  show  the  Net  Earnings, 
Interest  Liabilities,  and  Surplus  Earnings  after 
payment  of  Interest,  of  each  year  for  the  same 
period. 

INTEREST  PAID  ON  SURPLUS  OP  NET  EARN- 

NET  EARNINGS.  BONDED  DEBT.  INGS  OVER  INTEREST. 

1864......  $46,871.91  46,872 

1865 280,272.39  102,111  178,161 

1866 664,206.96  125,380  538,827 

1867 1,087,901.22  277,140  810,761 

1868 1,469,776.36  995,010  474,766 

1869 2,591,497.00  1,084,350  1,507,147 

1870 3,800,761.34  fl,834,930  1,965,831- 

1871 5,220,914.04  f2,884,414  2,336,500 

Total. .  .$15,162,201.22       $7,303,335  $7,858,865 

*  Including  the  California  and  Oregon  and  San  Joaquin  Valley 
Branches. 

t  The  amounts  in  the  above  table,  prior  to  and  including  the  year 
1869,  are  all  in  gold.  For  1870  and  1871,  for  greater  convenience 
in  exhibiting  results,  the  earnings  and  expenses  (which  are  partly 
in  currency  and  partly  in  gold),  and  the  interest  payments  (which 
are  in  gold),  are  all  stated  at  their  currency  value  by  adding  to  the 
amounts  received  and  paid  in  gold  the  average  premium  for  the 
year.  In  a  similar  table  given  in  our  pamphlet  of  Jan.  2d,  1871, 
the  amount  of  the  interest  payments  for  1870  was  stated  in  gold, 
while  in  the  above  the  premium  is  added. 


6 

The  Gross  Earnings  for  1872,  it  is  believed,  upon 
the  most  cautious  and  moderate  estimates,  will  not 
be  less  than  $12,500,000,  and  may  reach  $15,000,000, 
while  the  ratio  of  operating  expenses  is  not  ex- 
pected to  exceed  that  of  the  past  year. 

The  mileage  of  the  Central  Pacific  Railroad 
and  branches  has  been  increased  during  the  year 
45  miles,  independently  of  the  additional  side 
tracks,  &c,  laid.  The  lines  owned  and  controlled 
by  the  Central  Pacific  Railroad  Company  now 
include  the  following,  designated  according  to 
their  titles  previous  to  consolidation  : 

Main  Line.  Miles. 
Central  Pacific  E.   B.,    of   California,  Sacra- 
mento to  Ogden 742 

Westeen  Pacific  B.   E.,  of  California,  Sacra- 
mento to  San  Francisco 138 

Spue  Line  to  San  Jose ;  Niles  to  San  Jose 20 

Spur  and  Loop  Lines  near  San  Francisco. 
San  Francisco  and  Oakland  E.  E 8 


23 
Oakland  and  Alameda  E.  E 15 

Branch  Lines. 

California  and  Oregon  Branch,      (completed   116)  *330 

San  Joaquin  Valley              "                         "          58  152 

Second  and  Side  Track, 70  70 

Miles  completed, 1167 

Total  mileage, 1475 

*  The  length  of  this  branch  has  heretofore  been  stated  as  about 


The    equipment    of   the    Company   has    been 
enlarged   and    improved   during    the   year,    and 
additional  engine  houses  and  repair  shops  erected. 
It  consists,  at  the  date  of  our  latest  report,  of: 
Locomotives,  •-'       -        -       179 

Passenger  Cars,         -        -        -  172 

Mail  and  Baggage  Cars,  33 

Freight  and  Construction  Cars,         3645 
Engine  Houses,     -  8 

Repair  shops,    -  7 

The  Company  now  have  under  construction 
over  500  additional  freight  cars,  which  are  required 
for  the  rapidly  increasing  business  of  the  Road. 

The  value  of  the  Equipment,  shops,  &c,  is  at 
least  $8,000,000. 


In  our  last  Statement  reference  was  made  to  the 
consolidation  of  the  Western  Pacific  Railroad 
Company  with  the  Central  Pacific  Railroad  Com- 
pany, and  to  the  subsequent  consolidation  between 
the  Central  Pacific  Railroad  Company,  the  San 
Francisco,  Oakland,  and  Alameda  Railroad  Company, 
the  California  and  Oregon  Railroad  Company,  and 
the  San  Joaquin  Valley  Railroad  Company,  by  which 

312  miles.  After  numerous  and  thorough  surveys  the  Company 
have  determined  to  carry  the  line  up  the  Valley  of  the  Klamath 
River  to  the  Oregon  line,  thereby  lengthening  the  line  about  17  to 
18  miles.  By  this  change  in  the  route  very  heavy  grades  in  cross- 
ing the  Siskiyou  Mountains  are  avoided,  and  other  important  ad- 
vantages secured. 


8 

all  the  most  valuable  railroad  franchises  on  the 
Pacific  coast,  and,  in  fact,  almost  the  entire  rail- 
road system  of  California,  became  merged  and 
vested  in  the  Central  Pacific  Railroad  Company. 

The  Western  Pacific  and  the  San  Francisco, 
Oakland  and  Alameda  were  completed  Roads, 
connecting  the  Central  Pacific  at  Sacramento,  its 
original  Western  terminus,  with  San  Francisco, 
San  Jose  and  other  points,  and  they  now  form  a 
part  of  the  Main  Line  of  the  Central  Pacific  Rail- 
road. 

The  two  others,  now  known  respectively  as  the 
California  and  Oregon  Branch  and  the  San 
Joaquin  Yalley  Branch  of  the  Central  Pacific 
Railroad,  running  nearly  at  right  angles  with  the 
main  line,  reach  out  from  it  North  and  South 
into  the  two  remarkable  valleys  in  which  is  em- 
braced the  greater  part  of  the  agricultural  and 
mineral  wealth  of  California. 

These  two  branches,  now  being  constructed, 
have  assumed  an  importance  in  their  relations  to 
the  business,  wealth  and  future  revenues  of  the 
Company,  which  will  render  interesting  a  more 
extended  description  of  them  than  we  have 
heretofore  given. 

The  Route  of  the  California  and  Oregon 
Branch,  commencing   on  the   main    line  of  the 


Central  Pacific  Railroad  at  Roseville,  16  miles  east 
of  Sacramento,  extends  in  a  northerly  direction  up 
the  rich  and  fertile  Sacramento  Valley  to  the  Oregon 
boundary,  and  will  be  the  natural  outlet  for  a 
very  large  section  of  country,  now  rapidly  fill- 
ing up,  embracing  Northern  California  and  Ore- 
gon, to  San  Francisco,  the  metropolis  of  the  Pa- 
cific coast. 

It  is  already  completed  and  running  to  Red 
Bluff,  a  distance  of  116  miles,  and  considerable 
additional  work  has  been  done  beyond  this  point, 
which,  together  with  materials  on  hand  and  paid 
for,  represent  an  expenditure  of  $7,500,000. 

This  Branch,  when  completed,  will  be  about 
330  miles  in  length.  Connected  with  it  is  a  very 
valuable  land  grant,  from  the  United  States,  of 
12,800  acres  to  the  mile,  or  over  4,200,000  acres 
in  all,  consisting  to  a  very  large  extent  of  lands 
of  superior  value  and  fertility,  and  available  for 
immediate  and  rapid  settlement  as  the  Road  pro- 
gresses. 

The  Sacramento  Valley  is  remarkable  for  its 
extent,  fertility  and  resources,  having  a  length 
of  three  hundred  miles,  with  an  average  of  a 
hundred  miles  in  width,  including  foot  hills,  and 
contains,  perhaps,  the  largest  unbroken  body  of 
agricultural  land  west  of  the  Rocky  Mountains, 


10 

unless  the  Valley  of  the  San  Joaquin  River 
(which  is  its  counterpart  on  the  south)  be  the 
exception.  It  connects  the  thriving  cities  and 
towns  of  Sacramento,  Lincoln,  Marysville,  Chico, 
Red  Bluffs,  Tehama,  Shasta  and  Yreka ;  and  at 
the  California  boundary,  or  at  some  point  in 
Oregon,  will  meet  and  connect  with  projected 
roads  from  Portland,  Oregon,  and  will  thus  form 
the  most  valuable  portion  of  the  great  north  and 
south  line  of  the  Pacific  coast,  extending  from 
San  Francisco  to  Portland. 

By  Act  of  Congress,  there  were  granted  to  the 
California  and  Oregon  Railroad  Company  the  right 
of  way,  the  right  to  draw  materials  for  construction 
from  the  adjacent  public  lands,  and  twenty  alternate 
sections  (twelve  thousand  eight  hundred  acres) 
per  mile  of  the  public  lands  lying  along  the  route ; 
and  in  cases  of  preemption,  or  previous  disposal 
of  the  lands  within  the  twenty-mile  limits,  the 
Company  receives  the  privilege  to  make  up  the 
deficiency  from  sections  beyond  those  limits. 
By  the  consolidation  referred  to,  these  valuable 
grants  and  privileges  become  the  property  of  the 
Central  Pacific  Railroad  Company. 

When  it  is  understood  that  the  lands  thus  ob- 
tained are  among  the  best  in  California,  and  that 
for  all  the  purposes  of  agricultural,  horticultural, 


11 

• 

or  pastoral  uses,  they  are  not  excelled  by  any  on  the 
continent,  the  value  of  this  grant  may  be  appre- 
ciated, both  as  an  available  present  resource  of  the 
Company,  and  as  an  unfailing  source  of  future 
revenues. 

The  Company  will  be  entitled  to  patents 
for  about  two  million  acres  within  the  counties 
of  Placer,  Yuba,  Sutter,  Butte,  Tehama,  and 
Shasta,  comprising  the  finest  alluvial,  pasture 
and  vine  lands,  adjoining  which  are  the  lands 
of  private  owners,  which  have  commanded,  in 
the  absence  of  railroad  facilities,  from  iive  to  ten 
dollars  per  acre.  In  Siskiyou  County,  the  Com- 
pany will  have  nearly  one  million  acres  of  valua- 
ble timber  lands. 

The  natural  advantages  of  soil,  climate  and  pro- 
ducts of  the  valley  of  the  Sacramento  have  scarcely 
begun  to  be  developed.  Mining  for  the  precious 
metals  was  the  first,  and  is  to-day,  the  most  con- 
siderable branch  of  industry.  More  than  half  of 
the  entire  yield  of  California  gold  has  been  ex- 
tracted from  the  Sacramento  Valley,  and  it  is 
still  more  prolific  of  gold  than  any  equal  area  in 
the  world. 

Since  the  opening  of  the  Pacific  Railroad  a 
change  is  rapidly  taking  place.  The  precarious 
pursuits   of  the  mining  camp  are  being  supple- 


12 

merited  by  the  more  settled  and  permanent  in- 
dustries of  the  farmer  and  the    mechanic. 

The  average  yield  of  wheat  in  the  counties  of 
Tehama,  Shasta,  Sutter  and  Butte  is  found  to  be 
from  twenty  to  thirty  bushels  per  acre  ;  with  other 
small  grains  in  proportion. 

From  Mr.  Cronise's  valuable  work  on  the  "Natu- 
ral Wealth  of  California"  we  obtain  the  following 
statistics  on  the  population,  wealth  and  internal 
improvements  of  the  counties  through  which  the 
Road  passes :  In  1867,  before  the  completion  ot 
the  Pacific  Railroad,  and  while  the  communica- 
tions in  this  valley  were  most  imperfect,  there 
was  an  estimated  population  of  61,000,  mainly 
adult  males,  actively  engaged  ;  more  than  2,000,- 
000  bushels  of  wheat  were  raised  ;  21  grist  mills, 
29  saw  mills,  79  quartz  mills  and  one  woolen 
mill  had  been  erected,  beside  upwards  of  500 
miles  of  aqueducts,  used  for  mining  purposes. 
These  seven  counties,  according  to  the  latest  as- 
sessment, gave  an  aggregate  of  $26,422,639,  of  real 
and  personal  property. 

The  statistics  for  eight  other  collateral  counties 
in  the  same  valley,  more  or  less  tributary  to  the 
Road,  then  stood  at  about  the  same  aggregate  of 
population,  products  and  resources.  Since  that 
date  there  has  been  a  large  increase  in  settlement 
and  agricultural  products, 


13 

Not  a  hundredth  part  of  the  arable  land  in  the 
valley  is,  even  now,  inclosed  within  fences,  and  not 
one-thirtieth  of  that  inclosed  has  been  subjugated 
to  the  plow. 

It  is  stated  that  coal  has  been  discovered  along 
the  line  of  this  Road  in  the  vicinity  of  Chico.  Iron 
ore  is  abundant  and  is  now  worked  in  the  portion 
of  Oregon  through  which  the  connections  of  this 
Road  will  pass. 

The  amount  of  capital  already  invested  in  cattle 
and  sheep  in  the  Sacramento  Valley  is  large,  and 
is  constantly  increasing.  The  seasons  and  the 
herbage  in  this  portion  of  the  State  are  especially 
suitable  for  grazing  purposes,  and  the  products  of 
this  branch  of  husbandry  will  always  find  mar- 
kets in  the  cities  of  Central  California,  and  in  the 
mining  regions  of  Nevada,  by  means  of  this  Rail- 
road. 

The  capacity  of  this  valley  for  the  production  of 
immense  quantities  of  superior  wheat  and  other 
grains,  is  well  known,  and  it  only  requires  the  fa- 
cilities for  transportation  and  access  to  market, 
which  the  Railroad  will  afford,  to  render  it  one  of 
the  most  prolific  and  profitable  grain-producing 
regions  in  the  world. 

It  will  not  require  years  of  slow  development 
after  the  completion  of  the  Railroad  to  produce 


14 

this  result,  for  the  plow  and  the  seed  are  already 
anticipating  the  rails,  and  evidences  of  increased 
agricultural  industry  are  apparent  on  every  hand 
to  meet  the  Road  as  it  advances  up  the  valley. 

Probably  few,  if  any,  railroads  have  ever  been 
built  in  this  country,  with  a  greater  certainty  of 
ample  and  profitable  business  to  render  them  im- 
mediately remunerative. 


The  route  of  the  San  Joaquin  Valley  Branch 
commences  on  the  main  line  of  the  Central 
Pacific  Railroad,  at  Lathrop,  the  point  of  the 
greatest  southerly  deflection  of  the  latter,  about 
eighty  miles  east  of  San  Francisco,  and  ten  miles 
southwest  of  Stockton,  the  principal  city  of  the 
valley,  and  extends  southward  up  the  San  Joaquin 
Valley,  a  distance  of  152  miles,  in  a  direct  course 
to  Visalia,  an  important  centre  of  stage  travel  and 
of  mining  and  agricultural  traffic. 

The  valley  from  which  this  branch  derives  its 
name  is  the  southerly  portion  of  that  remarkable 
depression  which  reposes  between  the  Sierra  Ne- 
vada and  the  Coast  range  of  mountains,  and  which 
extends  nearly  the  entire  length  of  California. 
The  waters  of  this  valley  unite  with  those  flowing 
from  the  northern  portion,  and,  together  with  the 
Sacramento  River,  empty  into  the  Bay  of  San 
Francisco. 


15 

The  San  Joaquin  Valley  has  an  extreme  breadth 
of  140  miles,  and  contains  an  area  of  9,000  square 
miles  (or  one-third  greater  than  the  State  of  Massa- 
chusetts), a  large  proportion  of  which  is  suscep- 
tible of  fruitful  and  profitable  cultivation. 

This  broad  area  which,  with  its  northern 
counterpart,  the  Sacramento  Valley,  forms  a 
prominent  and  important  portion  of  the  great 
State  of  California,  has  long  been  known  as  one 
of  the  richest  mining  regions  of  that  State,  and 
more  recently  has  been  found  to  contain  wonder- 
ful resources  in  soil  and  climate  for  the  culture  of 
cereals,  wine  and  fruits,  and  for  the  raising  of 
cattle  and  sheep. 

It  embraces  within  its  limits  almost  every  va- 
riety of  climate  from  the  semi-topical  temperature 
of  the  alluvial  plains  at  the  bottom  of  the  valley, 
to  the  more  vigorous  atmosphere  which  nourishes 
the  forest  growth  of  the  mountain  slopes,  whose 
highest  peaks  are  perpetually  covered  with  snow. 

Besides  being  the  largest,  this  valley  is  one  of 
the  most  populous  and  productive  portions  of 
California. 

A  very  large  traffic  and  travel  have  been  car- 
ried on  between  its  various  towns  and  San  Fran- 
cisco for  years,  under  all  the  disadvantages  inci- 
dent  to  slow  and  costly  stage  travel   and   team 


16 

transportation,  slightly  aided  at  fitful  intervals  by 
a  light-draft,  uncertain  river  navigation. 

The  population,  as  given  in  the  subjoined  table,* 
consists  mainly  of  adults,  actively  engaged  in 
mining  or  agricultural  pursuits. 

The  extent  of  the  mining  interest  is  exhibited 
in  the  last  census,  in  which  are  reported  118 
quartz  mills,  with  an  aggregate  of  1,096  stamps 
for  the  crushing  of  auriferous  ores,  in  the  above- 
named  counties,  in  addition  to  the  large  amount 
of  capital  invested  in  aqueducts  for  gold  washing. 
Copper  and  quick-silver  are  also  extensively  mined 
in  the  valley. 

The  active  construction  of  the  San  Joaquin 
Valley  Branch  of  the  Central  Pacific  Railroad  was 
commenced  in  July,  1870,  soon  after  the  com- 
pletion of  the  main  line  between  Sacramento  and 
San  Francisco.  Twenty  miles  were  completed 
and  ready  for  operation  by  the  close  of  that  year. 

*  The  population  of  the  several  counties  into  which  the  valley  is 
divided  and  which  will  be  tributary  to  the  Railroad,  was  in  1870, 
according  to  the  United  States  Census,  as  follows: 

Counties.  Population.  Assessed  Value  of  Property- 

San  Joaquin 21,064  $7,601,000 

Stanislaus 6,510  1,609,000 

Merced 2,810  2,279,000 

Kern 2,335  1,346,000 

Calaveras 8,896  1,260,000 

Tuolomne 9,913  1,177,000 

Mariposa 4,572  1,093,000 

Fresno 6,336  2,007,000 

Tulare 4,695  4,171,000 


17 

During  the  past  year  (1871)  important 
bridges  across  the  Tuolomne  and  Merced  Rivers 
have  been  completed,  and  the  track  extended 
to  Merced  Station,  at  the  crossing  of  Bear  Creek, 
a  distance  of  58  miles  from  the  main  line. 

By  this  portion  of  the  Road  already  constructed, 
a  new  and  much  improved  route  is  opened  for 
tourist  travel  to  the  renowned  scenery  of  the 
Yosemite  Valley,  the  "  Big  Trees,"  the  Mari- 
posa Mines,  &c.  This  travel  is  yearly  increas- 
ing in  importance,  the  visitors  to  the  former 
point  alone  numbering  over  2,000  during  the 
past  season.  By  rendering  the  great  natural 
wonders  and  beauties  of  this  region  more  ac- 
cessible, and  the  trip  thither  more  convenient 
and  comfortable,  the  Railroad  will  attract  a  large 
increase  of  pleasure  travel,  which  will  prove  an 
important  source  of  revenue  to  the  Company. 

From  Bear  Creek  to  Yisalia,  94  miles,  the  Road 
will  readily  be  completed  within  from  10  to  20 
months,  as  may  be  deemed  necessary  or  advisable. 

The  Central  Pacific  Railroad  Company  regard 
this  Branch  as  the  most  valuable  feeder,  in  propor- 
tion to  its  length,  which  they  could  have  con- 
structed. 

That  portion  of  the  valley  which  the  Road  now 
traverses  has   been  long  known  as  "Paradise" 


18 

among  the  settlers,  from  the  salubrity  of  its  cli- 
mate and  its  wonderful  fertility.  The  entire  val- 
ley is  remarkable  for  the  depth,  richness  and  even- 
ness of  its  soil,  constituted  as  it  is  from  the  allu- 
vial deposits  of  thousands  of  years  in  what  was 
once  apparently  the  bed  of  an  inland  sea. 

A  large  immigration  of  hardy,  industrious  and 
thrifty  people  will  follow  the  Railroad  as  it  pene- 
trates this  attractive  and  fruitful  region. 

The  land  is  watered  by  numerous  streams,  hav- 
ing their  sources  in  the  enclosing  mountains  on 
either  hand  ;  and  private  corporations  are  now 
building  on  either  side  of  the  Railroad  an  exten- 
sive system  of  aqueducts  for  purposes  of  irrigation, 
which  will  ensure  an  abundant  and  steady  supply 
of  water,  completely  under  control  at  all  seasons, 
and  greatly  enhance  the  value  of  the  lands. 

The  chief  trade  of  Visalia  heretofore  has 
been  connected  with  the  numerous  mining  towns 
and  extensive  grazing  farms  of  the  surrounding 
country,  but  the  introduction  of  the  Railroad  will 
lead  to  the  production  on  a  large  scale,  of  Wheat, 
Wines,  Cotton,  Tobacco,  Beet  Sugar,  &c,  for  all 
of  which  the  climate  and  soil  are  peculiarly  favor- 
able. 


19 

The  Central  Pacific  Railroad  Company  have  not 
been  in  haste  to  part  with  their  valuable  land 
grants  in  large  tracts  at  low  prices,  leaving  to 
speculators  the  advantages  of  an  immense  future 
value ;  but  have  confined  their  sales  to  the  demands 
of  actual  settlers  and  resident  investors,  believing 
that  the  attractions  of  the  climate,  soil  and  markets 
of  California  will  draw  to  that  State  a  large  emigra- 
tion from  European  and  Eastern  States,  which 
must  enhance  the  value  of  their  land  many 
fold  within  a  few  years. 

By  the  Acts  of  Congress  the  Company  were 
granted  on  the  mainline  of  the  Central  Pacific  Boad, 
between  Sacramento  and  Ogden  (T42  miles)  twenty 
alternate  sections  of  public  lands,  or  12,800  acres 
per  mile  ;  and  on  the  California  and  Oregon 
Branch  (330  miles)  the  same  number  of  sections, 
or  a  total  of  over  13,000,000  acres. 

In  California,  the  lands  lying  on  each  side  of 
the  main  line  of  the  road  extend  from  the  navi- 
gable waters  of  the  Sacramento,  above  the  Bay  of 
San  Francisco,  across  the  broadest  and  most  pop- 
ulous portions  of  the  Sacramento  Valley,  and  both 
slopes  of  the  Sierra  Nevada  Mountains.  They 
are  diversified  in  soil  and  climate  and  conditions, 
embracing  the  semi-tropical  productions  of  the  low- 
er valleys  (corresponding  to  those  of  Spain,  Italy 


20 

and  the  shores  of  the  Mediterranean) ;  the  vine, 
orchard  and  grain  lands  of  the  foot  hills  (corres- 
ponding to  those  of  France,  Germany  and  Aus- 
tria); and  the  grazing  and  timber  lands  of  the 
mountain  slopes  (corresponding  to  those  of  Maine, 
Pennsylvania,  Sweden  and  Norway).  This  cen- 
tral portion  of  California  is  already  noted  for  the 
excellence  of  its  wheat,  grapes,  pears,  cherries, 
strawberries,  small  fruits  and  garden  vegetables 
generally,  and  for  the  ease  with  which  they  can  be 
grown  to  perfection  and  dimensions  unattainable 
elsewhere.  Wheat  may  safely  be  left  in  the  field 
until  threshed  and  shipped,  and  fruit  trees  do  not 
suffer  from  insects  or  blight. 

Along  the  California  and  Oregon  Branch,  in 
the  renowned  valley  of  the  Sacramento,  extending 
from  the  centre  to  the  northern  boundary  of  the 
State,  the  Company's  lands  have  the  same  general 
characteristics.  This  valley  is  at  present  the 
seat  of  the  most  successful  culture  of  small 
grains  (including  wheat,  barley,  oats,  &c.)  in  this 
country,  and  also  offers  unrivalled  facilities  for 
extensive  and  profitable  sheep  and  stock  raising. 
The  wThole  comprises  a  body  of  over  5,000,000 
acres  of  the  best  land  in  California. 

In  Nevada  the  main  line  of  the  Road  occupies 
the  Truckee  and  Humboldt   Valleys,  the  largest 


21 

and  best  settled  in  the  State,  at  a  short  distance 
from  the  numerous  and  important  mining  regions, 
whose  yield  of  precious  metals  is  estimated  at  from 
fifteen  to  twenty  millions  of  dollars  annually.  The 
lands  of  the  Company — about  5,000,000  acres- 
are  so  situated  as  to  command  these  markets  for 
their  produce.  Wherever  the  proper  cultivation 
has  been  applied,  these  lands  have  yielded  good 
crops  of  cereals  and  esculents. 

In  Utah,  in  the  great  Salt  Lake  and  contiguous 
Valleys,  where  the  Mormons  have  so  success- 
fully demonstrated  the  fertility  of  the  soil  and  the 
healthfulness  of  the  climate,  the  Company  have 
about  1,500,000  acres,  equal  in  all  respects  to  the 
lands  which  command  high  prices  at  points  in  the 
same  valley  further  south. 

The  present  value  of  the  lands  enumerated 
above,  cannot  be  estimated  at  less  than  $30,000,- 
000,  and  it  must  largely  increase  from  year  to  year. 

The  only  incumbrance  upon  them  is  a  Land 
Grant  Mortgage  of  $10,000,000. 

Up  to  30th  of  November  the  Land  Department 
had  sold  190,294  acres  of  land  for  the  sum  of 
$516,271.46,  of  which  all  but  $66,991.99  was  in 
coin. 

In  addition  to  the  above  grants  of  the  public 
lands,  the  Company  own  important  and  valuable 


22 

tracts  of  land  in  the  cities  of  San  Francisco,  Oak- 
land and  Sacramento,  and  at  other  important 
points  on  its  various  lines  of  road,  which  were  ac- 
quired for  its  own  uses  by  purchase  and  grant, 
when  comparatively  cheap,  but  which  are  now 
very  valuable. 


The  Capital  Stock  account  of  the  Company 
stands  as  follows,  viz  : 

Authorized  Capital  Stock. $100,000,000 

Amount  of  Capital  Stock  subscribed.      59,640,000 
Amount  of  Capital  Stock  paid  in 54,001,960 

No  dividends  have  hitherto  been  paid  upon  the 
Capital  Stock. 

The  Surplus  Earnings,  after  paying  interest 
and  providing  for  the  Sinking  Funds  in  accor- 
dance with  the  terms  of  the  mortgages,  have  been 
applied  to  the  extension  of  the  Branch  Lines  and 
similar  improvements,  thus  adding  largely  to 
the  value  of  the  Company's  property,  without  a 
corresponding  increase  in  the  Funded  Debt. 

It  is  expected  that  within  a  short  time,  the  sur- 
plus Earnings,  after  providing  for  interest  and 
Sinking  Funds,  will  be  divided  upon  the  Capital 
Stock. 

The  entire  surplus  Earnings  from  the  beginning 


23 

to  the  present  time,  as  shown  in  table  on  page  5, 
amounting  to  $7,858,865,  would  be  sufficient 
for  a  dividend  of  over  Fourteen  per  cent,  on  the 
amount  of  Capital  Stock  issued. 


The  First  Mortgage  Debt  of  the  Company 
is  as  follows  : 

Central  Pacific  R.  R.  of  California  First 
Mortgage  6  %  Gold  Bonds,  issued  on  the  main 
line  of  the  Central  Pacific  Railroad  from  Ogden 
to  Sacramento,  amounting  to  $25,885,000.  The 
Company  received  on  this  portion  of  the  Road, 
under  the  Pacific  Railroad  Acts  of  Congress,  U.  S. 
Government  Subsidy  Bonds  for  a  like  amount  of 
$25,885,000 — the  proceeds  of  which  were  applied 
to  its  construction  and  are  represented  in  the  value 
of  the  property  pledged  for  the  security  of  the 
First  Mortgage  Bonds. 

Western  Pacific  R.  R.  First  Mortgage  6  % 
Gold  Bonds,  originally  issued  by  the  Western  Pa- 
cific Railroad  Company,  on  their  Road  between 
Sacramento,  San  Jose  and  San  Francisco,  amount- 
ing to  $2,735,000,  now  assumed,  principal  and  in- 
terest, by  the  Central  Pacific  Railroad  Company, 
under  the  terms  of  the  consolidation  of  June, 
1870. 


24 

Upon  123J  miles  of  the  Western  Pacific  Rail- 
road, U.  S.  Subsidy  Bonds  were  granted  by  the 
Pacific  Railroad  Acts  of  Congress,  at  the  rate  of 
$16,000  per  mile,  amounting  to  $1,970,000,  the 
proceeds  of  which  were  applied  to  its  construction 
and  are  represented  in  the  value  of  the  property 
upon  which  the  First  Mortgage  Bonds  are  secured. 

California  and  Oregon  R.  R.  First  Mortgage 
6  %  Gold  Bonds,  issued  by  the  California  and  Ore- 
gon Railroad  Company  on  their  Road,  prior  to 
Consolidation,  amounting  to  $6,000,000  ;  now  as- 
sumed and  guaranteed,  principal  and  interest,  by 
the  Central  Pacific  Railroad  Company  under 
the  terms  of  the  consolidation  of  August,  1870. 

The  Central  Pacific  Railroad  Company  are  au- 
thorized to  issue  upon  their  California  and  Oregon 
Branch,  as  the  work  progresses,  a  further  amount 
of  First  Mortgage  Bonds  which,  with  the  above? 
will  make  a  total  of  $13,200,000. 

Central  Pacific  R,  R.  Co.  First  Mortgage  6% 
Gold  Bonds  (San  Joaquin  Valley  Branch)  issued 
by  the  Central  Pacific  Railroad  Company  since  the 
consolidation  of  August,  1870,  and  secured  by  a 
First  Mortgage  on  their  San  Joaquin  Valley 
Branch,  amounting  to  $6,080,000. 

The  additional  Miscellaneous  Bonds  not  in- 
cluded in  the  above  schedule  of  First   Mortgage 


25 

Debt  (with  the  exception  of  the  Land  Grant 
Bonds  previously  referred  to),  are  as  follows,  viz.  : 

Central  Pacific  R.  R.  State  Aid  7  %  Gold 
Bonds,  the  interest  on  which  is  paid  by  the  State 
of  California,  $1,500,000. 

Central  Pacific  R.  R.  Convertible  7  % 
Gold  Bonds,  $1,500,000. 

There  is  also  a  mortgage  of  $1,500,000  on  the 
Oakland  and  Alameda  Railroad,  which  was  con- 
solidated with  the  Central  Pacific  in  August,  1870. 


The  continued  success  of  the  Central  Pacific 
Railroad ;  its  rapidly  growing  traffic  and  earnings  ; 
the  increasing  value  of  the  immense  property  con- 
nected with  it,  together  with  the  high  stand- 
ing of  the  Company's  Securities  in  all  the  chief 
money  markets  of  the  World,  render  our  self- 
imposed  task  of  issuing  an  Annual  Statement  to 
those  who  have  invested  in  the  Bonds  one  of  in- 
creasing interest  and  satisfaction  to  us  from  year 
to  year. 

Very  respectfully, 

FISK  &  HATCH. 


k 


Harvey  Fisk.  A.  S.   Hatch. 

OFFICE  OF 

FISK   &  HATCH, 

!B  A.  1ST  K  353  IFL  SS , 

WD    DEALERS    IN 

GOVERNMENT    SECURITIES, 

No.  5  Nassau  Street,  New  York. 


Deposit  accounts  of  Banks,  Bankers,  and  others  received,  on  which  we 
allow  interest  at  the  rate  of  four  per  cent,  per  annum.  Checks  drawn  on  as 
are  payable  on  presentation,  without  notice,  the  same  as  at  a  National  Bank. 

Certificates  of  Deposit,  bearing  interest  at  special  rates  to  be  agreed  upon, 
will  be  issued  to  Savings  Banks,  Institutions.  Trustees  of  Estates,  and  others 
having  sums  of  money  awraiting  investment. 

We  make  Collections  on  all  points  of  the  United  States  an  1  Canadas.  and 
issue  Certificates  of  Deposit  available  in  all  parts  of  the  Union. 

We  buy  and  sell,  at  current  rates,  all  classes  of  Government  Securities. 

We  buy  and  sell,  at  ilie  Stock  Exchange,  Investment-Stocks  and  Bonds, 
on  commission,  for  cash. 

We  buy  and  sell  the  Bonds  of  the  CENTRAL  PACIFIC  RAILROAD 
COMPANY. 

As   Financial  Agents  I  HESAPEAKE  AND  OHIO   RAILROAD 

COMPANY,  we  are  now  offering  the  last  of  their  FIFTEEN  MILLION  SIX 
PER  CENT.  GOLD  LOAN,  secured  by  mortgage  on  their  whole  Railroad 
property  and  franchises.  The  Bonds  may  be  Coupon  or  Registered;  they  are 
of  $1000,  $500,  and  $100  each;  have  30  years  to  run  from  ISO!);  Principal  and 
Interest  (May  and  November)  payable  in  coin,  in  New-York  City.  We  recom- 
mend them  to  our  friends  and  customers  desiring  safe  investments,  with  the 
same  confidence  with  which  we  lave  sold  the  Bonds  of  the  U.  S.  Government 
and  the  Central  Pacific  Railroad  Co.         '%   ,: 

Communications  and  inquires,  by  mail  or  telegraph,  will  receive  prompt 
and  careful  attention. 

FISK  &  HATCH. 


' 


